The Regulate, Control, and Tax Cannabis Act of 2010
By Dion Markgraaff
Most people in the cannabis industry are excited about the spring season, when we plan and plant for our future through our gardens. This year brings extra potential because never before in the history of the world has there been a bigger, more important time than now. Californians have the chance to change the course our planet is on this November when we vote on the Regulate, Control, and Tax Cannabis Act of 2010. This vote is the best opportunity in our lifetime to make real change.
Victory is not guaranteed. We all need to take the extra steps in our lives to educate those around us in order to increase the odds of this initiative passing. For the rest of your life, you will be thinking of this time period and whether you fought hard enough to end cannabis persecution. Future generations will marvel at our historic stupidity towards the planetâ€™s most useful resource, cannabis. This monumental vote will create more cannabis freedom and a saner policy of economic taxation through a civil not criminal means.
Yes â€“under the current policy of prohibition which attempts to restrict the flow of cannabis from farmer to consumer, our society is being taxed at an incredible rate. More people were arrested for cannabis in 2009 (including me) than ever before in the history of our state, country, and world; yet there continues to be more and more cannabis consumers. Statewide, extraordinary prison costs and populations, and failing healthcare and crumbling education systems are some of the consequences of our criminalization policy towards cannabis.
For example, last year the Oceanside government decided to eliminate 1 of the 4 ambulances servicing the city because of decreasing tax revenues and budget problems. This means that if you are in that area and unlucky enough to get hurt, you have a 25% less chance of being rescued.
This policy decision was made after Oceanside voted against enacting zoning laws which would have established guidelines for medical cannabis collectives and allowed the city to collect millions of dollars in sales tax. Instead of authorizing collectives to be licensed and regulated by the city – patients, caregivers, and law enforcement officials are left to swim in a chaotic and terror filled environment that is also woefully economically inefficient. These conditions force everyone in society to pay an inflated criminal prohibition policy price.
Overpaying for our cannabis now
For the consumers in California, the bottom line of our criminal taxation policy is paying 20, 30, or 40 billion dollars per year just for the glands of the cannabis flower. Not only are you paying $10-$20 per gram from your local connection, until the evolution of dispensaries, you had little to no choices.
Even many in government believe the time has come to tax and regulate this huge industry. The State Board of Equalization acknowledges that Californians grow and buy cannabis worth billions of dollars. A bill by Assemblyman Tom Ammiano, D-San Francisco, would apply a $50 per ounce excise tax on cannabis. In an analysis of the bill, the Board of Equalizationâ€™s conservative figures forecast that such a tax rate would generate $1.25 billion in annual tax revenues to the state and an additional $120 million in local sales taxes.
On a federal level, â€œRegulating the adult use of marijuana in a manner similar to alcohol could raise over $30 billion annually in new tax revenue, while saving an additional $15 billion per year in law enforcement costs,â€ NORML Foundation Executive Director Allen St. Pierre said.Â â€œThis tax season, why not ask your elected politicians why the federal government continues to spends billions of tax dollars enforcing this failed and archaic public policy.â€
According to a report by Professor Jeffrey A. Miron of Harvard University, which was endorsed by 500 economists, the complete legalization of marijuana would save federal and state governments an estimated $7.7 billion in law enforcement costs and generate an additional $2.2 billion in tax revenue. These are conservative figures, especially considering analysis of the Regulate, Control, and Tax Cannabis Act of 2010 shows the annual revenue stemming from the California ballot initiative would amount to over half ofÂ Professor Mironâ€™s savings and tax income projections.
However, the biggest fact which is often overlooked in academic studies of different policies is that making cannabis cheaper to the consumers will instantly put tens of billions of dollars into the rest of our economy. In other words, if we Californians were only paying $10 billion dollars for the amount we use, then the leftover billions can be spent on our children, homes, vacations, education, etc.
Money makes the world go around – Novemberâ€™s perfect economic storm?
Money is the biggest reason for this proposed legislation, the Regulate, Control, and Tax Cannabis Act of 2010. Come this fall, two massive forces going separate directions will collide. The State of California is literally going bankrupt while the stateâ€™s biggest agricultural commodity, cannabis, continues to go through the roof. By November, California growers will be gathering another record harvest.
Cannabis is the biggest cash crop in every city, state, and country in the world, and itâ€™s ready to be civilly taxed. Yet, the government ignores this source of revenue even though it does not have enough money to manage our society. Education, civil services, courts, and even cops are getting cut.
Big cannabis businesses brings in big money
Canadian farmers are making more per acre for hemp than any other crop. Today in the United States, hemp is a $360 million growing industry which is replacing many raw materials used in major industries.
The best selling natural soap in America, Dr. Bronnerâ€™s, a local multimillion dollar company, is the worldâ€™s number one consumer of hemp oil in their products. Hanes, which sells over $4.2 billion a year in apparel, is going to use material made with 20% cannabis fibers from now on. The reasons the company is using hemp fibers are the added hemp reduces shrinkage by 50% and dye usage by 20%. Cannabis is also taking over the car industry because the plantâ€™s fibers are processed into a hemp plastic which produces body parts that are stronger and lighter than other options. And, there are 3 different national hemp milk companies.
Sensible cannabis policies towards the flowers can bring in cash even quicker. The city of Denver has already implemented regulations on medical cannabis dispensaries and has generated more than $1 million in licensing fees alone in just over a month. Bringing all 500 dispensaries into compliance will generate $2.5 million per year for the city in licensing fees, and their society reaps an additional 4.64% in taxes on each sales transaction.
California has around 2000 medical cannabis dispensaries today. Once we pass the Regulate, Control, and Tax Cannabis Act of 2010 and allow the open market to decide the number of distribution points, we could have 10 to a 100 times more stores by this time next year.
Jobs and more money
The biggest growth potential for jobs is in the cannabis field. Not only is our industry renting storefronts and helping the real estate market, each location must average 10 direct jobs and potentially tens to hundreds more auxiliary jobs. Using this math, California has hundreds of thousands to millions of jobs on the line with this vote.
The annual THC Expose at the Los Angeles Convention Center is tapping into this growing employment opportunity trend, and as their website says, â€œThe cannabis/hemp industry is among the fastest growing industries in America. THC Expose will help the non cannabis consumer understand the dynamics of a growing industry and the need for more services and products within this new economic boom. As many industries are restructuring and laying off employees the cannabis industry seems to be growing in the opposite direction.â€
A clear sign of the evolution in the cannabis revolution is the addition into the cannabis marketplace of mainstream businesses like the insurance industry. Statewide Insurance Services recently decided to venture into the cannabis trade. For the first time in modern history, insurance companies are covering cannabis stores, growers, and patients from theft, natural damage, and raids.
USA Todayâ€™s March 2010 article, â€œSlowly, states are lessening limits on marijuanaâ€ states:
â€œA Gallup Poll last October found 44% favor making marijuana legal, an eight-point jump since the question was asked in 2005.Â An ABC News-Washington Post poll in January found 81% favor making marijuana legal for medical use.â€¦ The American Medical Association recommended in November that Congress reclassify marijuanaâ€¦. At least 14 states this year — some deeply conservative and Republican-leaning, such as Kansas — will consider legalizing pot for medical purposes or lessening the penalties for possessing small amounts for personal use.Â Fourteen other states and the District of Columbia already have liberalized their marijuana laws.â€
You reap what you sow
In California, we need to start acting now in planting for November. From the cannabis lovers to its haters, we must move everyone we know closer to common sense and a â€˜Yesâ€™ vote. Do more to educate others on the importance of passing this historic initiative – contribute your time, energy, and money towards the greatest cause and opportunity of your lifetime.
We, the people, have the power everyday with what we consume, but rarely at the election box. The time is now. The Berlin Wall did not come down on its own. It took years of cultivating the seeds of change, and then at a certain point – going out physically and tearing down the Wall, taking the barrier apart brick by brick.
If you are reading these words – you are ahead of the curve on this subject making you consciously obligated to take out a brick in the wall of cannabis prohibition. Do everything you can to pass the Regulate, Control, and Tax Cannabis Act of 2010.